Random thoughts of a Birmingham-based political junkie and party hack, Labour member and activist. And a Councillor for the City of Birmingham, representing Acocks Green ward.

Monday, October 25, 2010

Iniquity and inequality on housing benefit

One of the nastiest benefit changes - in a strong field of vicious attacks on some of the poorest and ill-protected in our society - is on housing benefit.

If you are unemployed for a year, you will face a 10% cut in benefit. Perhaps your landlord might be understanding and reduce your rent accordingly - this is clearly the hope of the government, as they attempt to reshape the market to save money. I wouldn't bet on that happening - and research for London Councils says that it won't.

If you are under 35, you will be deemed not to require sole occupancy of a property, so benefit will be paid only at the shared home rate - including to existing claimants.

If you happen to live in an area with high rental costs, your benefit will be capped to force you to relocate.

The upshot is that thousands of people will be forced to move away from their current housing - forced to find two or three months' rent up front for a deposit, to cover their moving costs and to move away from their children's schools, their family and social supportive network and even to leave their jobs, because many working people on a low wage rely on housing benefit to top up their income if they live in some of the more expensive areas of the country - like London. While the Tories highlighted a tiny number of excessive claims, this was only an attempt to justify inflicting pain on thousands more families. According to Helen Williams of the National Housing Federation,

Almost 100% of claimants will be worse off. There's a very real risk that these cuts will push hundreds of thousands of people into poverty, debt and even on to the streets if they end up being evicted.

The amount lost will vary, but it averages at £11-12 a week - and that is a considerable chunk of money. Sajid Javid, Tory MP for Bromsgrove, dismissed it on the Politics Show last week, but when your sole other income is jobseekers allowance at £65 a week, finding an additional £11 to keep a roof over the heads of you and your family will put many into impossible positions - 170,000 pensioners, 240,000 low paid workers and half a million others are expected to suffer this. For many, the gap will prove impossible to fill, especially with inflation and pay freezes, so they will have to throw themselves on the mercy of their local authority, who will insist that you wait for the eviction notice to be served before they look at rehousing, degrading people still further by the prospect of court action. Even better, those who have been evicted may face a money judgement, which will hammer their credit score and reduce further their chances of getting a mortgage in the future (and believe me, it isn't easy for a first-time buyer at the moment) or of finding reasonably priced accommodation, as landlords will be understandably wary of taking on a previously-evicted tenant.

Local authorities are planning ahead. Dave Hill expands on a report from Inside Housing that those in London are already talking to landlords as far afield as Hastings, Watford, Slough, Reading and Luton. Bed and breakfast accommodation is being considered as suitable for long-term occupation, rather than just emergency cases. I understand that Birmingham is about to start a similar conversation with landlords outside the City, as there will be an expected exodus of 14,000 claimants in Birmingham.

We need to do something about a housing benefit bill which has gone up from£10bn to £21bn in recent years under Labour and there haven't been enoughaffordable homes built.

He said that it was not fair that those people who went out to work got less help with accommodation than those who did not. Surely the point is that we expect those who are earning to pay more towards their housing costs? Very few people actually get enough housing benefit to cover all the costs - contributions are the norm - and it seems fair that as you earn more, so that benefit decreases. Clegg seems to have a very variable definition of 'fair.' His ideas for building homes are also intriguing, as they rely on halving the budget for homes and relying on new tenants to pay higher rents to support further building (rents that will be part subsidised by Housing Benefit in many cases).

As I've noted elsewhere, we didn't build enough council or housing association properties while in government. That was a key mistake by the Labour Party, but it is rectifiable. A proper building programme - not one slashed in half, but one that is doubled or more - would create jobs for the depressed construction sector, employing many low-wage workers and create real infra-structure for the future. It would be real value for money and it would provide homes.

This policy amounts to far more than a money-saving wheeze by the government, it is a plan for social and electoral engineering on a scale that would stun Shirley Porter, former leader of Westminster and the current postergirl for this gerrymandering.

John Cruddas said, rightly

"It is tantamount to cleansing the poor out of rich areas – a brutal and shocking piece of social engineering"

and the chief executive of the National Housing Federation, David Orr, added

"Unless ministers urgently reconsider these punitive cuts, we could see more people sleeping rough than at any stage during the last 30 years."

As mentioned in an earlier post, I half expect to see these plans softened as part of the presentational scheme to demonstrate the moderating influence that the Liberal Democrats have on the Tory slashers. I hope that this is part of that staged theatrical performance and will not go through untouched by parliament, because any MP that supports this policy as is should hang their head in shame.